Born to an Italian immigrant and raised on a walnut ranch in Carmel Valley, California, Mr Panetta, 56, is a consummate Washington insider with a reputation for integrity and candour. First elected to the House of Representatives in 1976, he also demonstrated frugality, buying his own office furniture and using air-miles credit to pay for business flights - which was reflected in a zealous commitment to cutting the federal budget deficit.
It was as anti-deficit crusader that Mr Panetta found himself drawn into the Clinton team as White House budget director. His record on stripping down spending and angering other Democrats by always entertaining increases in taxation helped the new President gain credibility on Wall Street.
But beyond his number-crunching skills, it is his broader experience as a Capitol Hill wheeler-dealer and conciliator that will count now as he steps up to become chief-of-staff.
Mr Panetta started political life as a Republican and worked in the late Sixties for President Richard Nixon as Civil Rights Director in the old Health, Education and Welfare Department. He left the administration, and then the Republican Party in 1970, complaining he had been blocked by the White House from enforcing desegregation in the South. In a characteristically frank remark to reporters, he said his enemies would not be satisfied until they 'shoot 10 blacks on Washington's birthday'.
Last April, Mr Panetta said to journalists that the President faced disaster unless he shaped up and had to do a 'better job of picking and choosing the battles he wants to go through if he is to avoid more defeats'. If that is still Mr Panetta's perception, then he will doubtless make it plain once more. But the question is whether he will have the skill and steel to impose order on a White House that still seems largely bereft of focus and discipline.
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